Excise Dept mulls carbon tax on oil refineries and EV batteries
The Excise Department aims to promote ESG (Environmental, Social, and Governance) goals through the implementation of a carbon tax facility, along with the establishment of a Carbon Border Adjustment Mechanism (CBAM) team, to develop a globally standardised tax structure.
This initiative targets taxing carbon emissions released by oil refineries and proposing a carbon tax on EV batteries to address EV waste disposal issues in the future.
The European Union (EU) will begin testing its Carbon Border Adjustment Mechanism (CBAM) from October 1, 2023, for seven product categories: aluminium, steel, cement, fertilisers, electricity, hydrogen, and other upstream goods like nuts and screws made of steel. The Excise Department's director general, Ekniti Nitithanprapas, emphasised that this carbon tax facility aligns with ESG principles, focusing on environmental, social, and governance aspects.
In the pursuit of sustainable development and environmental concerns, the Excise Department is also exploring the idea of carbon taxation for the energy and transport sectors, given that Thailand currently emits around 400 million tons of carbon dioxide annually, with energy and transport accounting for 65-70% of these emissions.
The carbon tax structure would be internationally standardised and encompass various types of energy sources, such as biodiesel, or E20, based on their carbon emissions. The Excise Department's goal is to establish a system that can effectively control carbon emissions at the refinery level and encourage a greener approach to energy consumption.
Ekniti also mentioned that while EVs help reduce carbon emissions, there is a potential future issue with EV batteries becoming waste. To mitigate this, the department is developing a tax structure for EV batteries to encourage recycling and proper disposal. The carbon tax facility and EV battery taxation aim to align with global ESG trends, promote sustainability, and contribute to a greener and more environmentally friendly economy.
